WEST PALM BEACH, FL (HEDGECO.NET) – Deutsche Asset Management Company [DeAM] has announced a plan to offer leveraged funds of hedge funds. The new deal was reached with Tricom Equities, according topublished reports. Tricom Equities will also be involved with the distribution of the new products, according to the released statements.
The new DeAM absolute return product called the Strategic Value Fund will also be offered through DeAM�s vast distribution channels, as well as through those of Tricom, according to Glenn Poswell. Poswell is the DB Absolute Return Strategies Asia Pacific head; the launching of such product was necessitated by investor demand.
Poswell explained that hedge fund margin lending is recently seen as a strategy to aid fund managers� ability to achieve higher returns, with limited volatility. Such strategy according to Poswell, compares to margin lending for stocks and other traditional asset classes. DeAM and Tricom are offering a higher loan to valuation ratio (LVR) of 75 percent. According to Poswell, as part of the offering DeAM and Tricom will offer the 75 percent LVR at an interest rate of 7.89 percent for the margin loan, available to the end of July.
The minimum investment requirement for new fund was established at US $25,000, but through the provision of the 75% leveraged option, investors will only provide US $6,250 of their own money. Institutional investors will also have a reduced minimum investment of US $500,000.
The Deutsche Asset Management Strategic Fund is a multi-strategy/multi-manager portfolio; assets under management have grown recently according to published reports to about US $290 million.
Paul Oranika
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